Armed with up to $25 million in aid from state and local government, defense contractor Leonardo DRS Inc. plans to leave its current location on Milwaukee's north side and move those operations, which currently employ 449 full-time workers, to Menomonee Falls.

The company will occupy a $56 million, 350,000-square-foot factory and engineering plant to be built in the Woodland Prime office park north of Good Hope Road on the eastern edge of the Waukesha County suburb.

DRS now is located at 4265 N. 30th St. That plant "is more than 65 years old and (is) at capacity," the Wisconsin Economic Development Corp. said Monday in announcing an award of state tax credits for DRS. In seeking a location for a new facility, DRS "considered locales in multiple states," the agency said.

The state will give DRS up to $18.5 million in income tax credits over the next seven years. The credits are refundable, meaning that if DRS does not owe taxes, it still will receive payments from the state.

Wisconsin waives taxes on almost all manufacturing profits.

DRS will receive the credits — or payments — for retaining existing jobs, creating up to 220 new jobs, making capital investments and doing training.

The largest single portion, $7.625 million, would go to DRS for holding on to its current employment level. The company also stands to receive $4 million if it creates 220 new jobs, $5.375 million for making capital investments, and $1.5 million for training.

Menomonee Falls, meanwhile, will provide just under $6.4 million to DRS through a tax increment district the Village Board approved Monday evening.

That money will come from new property taxes in the district — essentially, the taxes on the property DRS will occupy.

The village will provide $2 million to pay for electric power infrastructure the manufacturing operation will need. The rest of the village assistance, nearly $4.4 million, will be in the form of payments to the company over 20 years, village manager Mark Fitzgerald said in an interview.

If DRS follows through with its plans, it will shadow another manufacturer that left the same north side Milwaukee neighborhood for the same Menomonee Falls office park. Eaton Corp., which formerly was just a few blocks east of DRS at 4201 N. 27th St., developed its $15 million division headquarters at Woodland Prime with a state award of up to $1 million in tax credits and $3 million in village financing help.

Asked in an interview whether it was appropriate for Menomonee Falls to subsidize the relocation of a business from a neighboring community, Fitzgerald said, "That's a good question. We did not seek out the company. They came to us after they exhausted their possible locations for relocating in Milwaukee."

WEDC spokesman Mark Maley said by email Tuesday that DRS "was seriously considering relocating its Milwaukee facility to the East Coast to be closer to its customers, which would have resulted in the loss of almost 450 jobs in the region."

"WEDC worked with the Milwaukee 7 to find a way for the company to not only keep those jobs in Wisconsin and the region, but to commit to building a state-of-the-art facility that will create hundreds of direct and indirect jobs in the Milwaukee area," Maley said. "It should be noted there was an extensive search for facilities within the city of Milwaukee that would meet the company’s needs."

Maley said WEDC "does not steer jobs from one community to another. Our primary objective was to ensure that a global company made the decision to remain and grow in Wisconsin, not in another state."

The new DRS plant and offices will accommodate the company's "growing Naval Power Systems line of business," WEDC said. The agency said the facility will handle the design and manufacturing for naval and marine power distribution, power conversion, motor controls, drives and automation/control equipment for the U.S. Navy, and for commercial and international customers.

The Milwaukee Common Council and Mayor Tom Barrett in 2005 voted to provide $1.5 million to help DRS renovate its Milwaukee plant — an $11.3 million project. The company then had 370 employees, with plans to add 80 after the project was finished. The improvements were designed to help make the facility more efficient, and expand the company’s testing and research laboratory.

DRS is the former Eaton Navy Controls. That division of Eaton Corp. was bought in 2002 by DRS Technologies, of Parsippany, N.J.

Italy-based Finmeccanica, SpA. bought DRS in 2008. Finmeccanica changed its name in 2016 to Leonardo SpA. The firm had more than $12 billion in revenue last year.